Biz Buzz: ‘Twisting the truth’
In a hastily called press conference last week, a private lawyer hired by the state-owned Development Bank of the Philippines—also acting as the bank’s new spokesperson—issued a five-page statement pointing squarely to the Bangko Sentral ng Pilipinas (BSP) as the entity that prompted the bank to initiate a probe on the allegedly anomalous P660-million loan to businessman Roberto Ongpin.
That evening and on the following day, several news outfits carried the news citing the central bank as the instigator of the probe (which is being blamed for DBP lawyer Benjamin Pinpin’s suicide two weeks ago).
As part of its attack on former bank president Rey David and Ongpin, DBP said the transactions exposed the bank to sanctions by the BSP (transcripts of the press conference showed that the spokesperson was NOT misquoted).
But lo and behold! A check with the BSP revealed that not a few facts were being fudged by the new guys running the government financial institution.
While DBP had pointed to BSP as having called their attention to the purportedly anomalous loans, it turned out that it was the DBP itself that had sent BSP a copy of its own internal probe, in the hope of encouraging BSP to sanction the bank for the transactions.
Upon receiving the report, BSP merely took note of it and wrote back and asked for more details—an act that was “spun” to make it appear that BSP—and not DBP—was behind the probe. According to our sources, this was called to the attention of DBP’s embarrassed new bosses, who had to take out a paid ad last Saturday to “clarify” the issue.
“Half truths are lies,” said one central bank official in describing DBP’s line of attack, with another adding that the bank was “twisting the facts.”
So how can the public differentiate the good guys from the bad guys in this controversy? The Bible says it best: “By their acts shall you know them.”—Daxim L. Lucas
Whodunit?
So the question begs to be asked: Who is the prime mover behind this DBP probe into the bank’s supposedly anomalous loans to Bobby Ongpin?
According to our sources, it is being egged on by a former candidate for national office who is sore at Ongpin for having supported—successfully—a rival candidate in last year’s polls.
At the same time, the DBP probe is being touted as this faction’s answer to the series of successes that the other faction of the administration has had in uncovering anomalies under the previous administration (like the P1-billion Pagcor coffee issue).
Which side? One look at the composition of the current DBP board will reveal volumes.
“Everyone is jostling to outdo each other with exposés nowadays, because they know it’s the best way to get on the President’s good side,” said one particularly well-connected source.
According to our sources, at least three other DBP transactions are being investigated as second, third and fourth lines of defense, in case the current case falls through. Never say die!—Daxim L. Lucas
New telco challenger
While most people think that telecom veteran Anastacio “Boy” Martirez is busy as a bee with Qatar Telecom’s offshore interests, the former head of Liberty Telecoms (a joint venture between Q-Tel and San Miguel Corp.) has been spotted onshore doing the groundwork for a start-up local telco company aspiring to be the next game-changer in the duopolistic industry.
Martirez, who has also spent 18 years with the PLDT group before Liberty and Q-Tel, has teamed up with businessman and former politician Mark Jimenez to set up a company called Pinoy Telekoms, which aims to be a low-cost provider of 4G telecom services.
Industry sources said Martirez, who left Liberty early this year, had irreconcilable differences with the chief representative of Q-Tel in the Philippines (which not even San Miguel could patch up) and thus accepted an offshore post brokered by a headhunter. His return has thus raised some eyebrows even as it seems to suggest there indeed is room for more competition in the local telecommunication business.
Based on the fledgling company’s corporate profile, Martirez will be the chair and CEO of the company, which is headquartered in Fort Bonifacio. The plan is for Pinoy Telekoms to enter into a strategic partnership with telco service provider PacNet HK, which owns Asia’s biggest submarine cable infrastructure.—Doris C. Dumlao
Online battle
The Metrobank group’s stockbrokerage arm First Metro Securities, which recently named a new president in the person of Gonzalo Ordoñez, is seeking to heat up competition in the online trading business.
Ordoñez said the local equities brokerage has been quietly beefing up its online stock trading system since April and would unveil new tools in the coming weeks to make its platform “the best online trading system around.”
“The newly implemented system executes orders faster than any other system in the market,” the new chief said. “It is also designed to be scalable so that processing will remain robust as First Metro Sec adds new online clients.”—Doris C. Dumlao
BPI@160
The Ayalas’ Bank of the Philippine Islands, the oldest bank not just in the Philippines but in Southeast Asia, will open by September its very first museum as part of the celebration for its 160th anniversary. This is to give a home to the bank’s various memorabilia accumulated since the colonial period (to be located at a historical site, no less).
Established in 1924, BPI’s Cebu branch was the bank’s third provincial branch to open. It transferred to its present location in 1941 and became known as the Cebu main branch. This was identified as the best site for the museum, being a short walk from the famous Basilica del Sto. Niño and a stone’s throw from the Magellan’s Cross shrine.
The pre-war building housing its Cebu branch, which will likewise soon host the museum, was built in 1940 by the renowned architect Juan Arellano and has been declared as a National Historical Landmark by the National Historical Commission.—Doris C. Dumlao
Banks’ cover blown
In recent weeks, the abnormal strength of the peso has got even Malacañang worried, given its impact on the value of remittances sent home by overseas Filipinos to their local beneficiaries and the eroding price competitiveness of exporters.
So last week, everyone was waiting for the Bangko Sentral ng Pilipinas to act on the Non-Deliverable Forwards market (NDFs in banking parlance).
The facility was put in place by the BSP to help protect the peso against speculative attacks a decade ago when bankers were trying to push it past the 60:$1 level. Nowadays, times are very different and bankers have been trying to push it the other way—past the 40:$1 level—through the very same facility.
So the BSP last week exercised its power of “moral suasion” to have banks reduce their use of NDFs, which regulators suspect are increasingly being used to speculate on the exchange rate rather than to fund legitimate currency requirements of bank clients.
Early this year, banks have already agreed among themselves—through the so-called “gentleman’s agreement”—to limit their NDF volumes to what they had at that time (a.k.a. “We will speculate to this level, and until this level only.”). In the months that had passed, no one has ever admitted that this gentleman’s agreement existed and no one even wanted to use the term.
Suddenly last week, the BSP blew the cover on the whole thing. BSP Governor Amando Tetangco Jr. told reporters that regulators were in consultation with banks on how best to reduce foreign exchange volatility, and announcing that they have agreed to cut NDF volumes by 20 percent under the gentleman’s agreement.
Asked for comment about this disclosure, ranking officials of the Bankers Association of the Philippines continued to play coy, evading the issue and sidestepping reporters’ questions.
After seeing the news later that day, only then did they realize that their cover had been blown. Awkward.—Daxim L. Lucas
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